D&L officials defend the company

May 23, 2013

COLUMBUS - A Mahoning Valley injection-well operator whose former senior officer faces federal charges of violating the Clean Water Act told a state regulatory panel Wednesday that the company can't be blamed for the acts of "a bad person."

Youngstown-based D&L Energy attorney Michael Cyphert was speaking of Ben Lupo, a sometime president and owner of D&L who has been charged with ordering an employee at a separate company he managed to repeatedly dump gas-drilling wastewater intended for an injection well into a storm sewer. Lupo and the employee of Hardrock Excavating LLC have pleaded not guilty.

Cyphert said commissioners need to ask themselves who Lupo was acting on behalf of, and who his actions benefited - and the answer will not be D&L.

"Go ahead and assume, and I'm willing to have you assume, Ben Lupo's a bad person. He intentionally directed someone to put brine down a sewer. He shouldn't have done that, shouldn't have done that," Cyphert said. "Are those actions to be imputed to the company simply because he's an officer of the company, or was an officer at the time?"

D&L is asking the commission to overturn an order issued by state Oil & Gas Chief Rick Simmers earlier this year revoking D&L's six active permits, denying three pending injection-well applications, and suspending its storage of wastewater amid the federal investigation into Lupo's actions. Two days have been set aside for the commission's hearing, with a decision to come in weeks or months.

Brian Ball, the state's lawyer, said Lupo was the key figure linking several companies that were working together and therefore jointly liable. He said D&L had entered into business agreements with both Mohawk Disposal Management LLC and Hardrock Excavating. The companies were grappling to keep up with disposal of tens of thousands of gallons of wastewater from the shale gas drilling boom that's come to the region, he said.

Ball said state witnesses would show Lupo was "the heart and soul and the commonality between the consortium of companies located at this address, companies that were often - at least in the three considered, Mohawk, Hardrock and D&L Energy - conspiring and causing unlawful activity with systematic routine practice."

During questioning of Simmers, Cyphert strongly challenged the official to produce proof of the link between D&L and Hardrock or Lupo that prompted his sweeping order.

"Just because we can slam dunk and kill off an entity's business doesn't mean we should," Cyphert said.

Simmers said the illegal dumping was observed by state inspectors on Jan. 31 at the headquarters property of D&L and that Lupo, then D&L's president, indicated he ordered the dumping.

Simmers said, "There were many things that were the basis for the order. No one thing was the basis."

D&L also operated an injection well located at the epicenter of a series of earthquakes in the Youngstown area mostly in 2011. Activity at that well and several inactive sites nearby was halted as part of a temporary moratorium imposed by Gov. John Kasich.